More Sellers are Listing Their Homes, But Buying Frenzy Speeds Ahead

Rhea-AI Summary

Home seller confidence is on the rise, with new homes entering the market nearing last year's levels, according to Zillow's Weekly Market Report. However, buyer demand remains robust, with newly pending sales up 16.5% year-over-year. This is the largest increase since mid-February. Currently, the median U.S. list price stands at $345,255, marking an 8.3% increase from last year. Despite a 10.6% drop in new for-sale listings, inventory is down 28.9% compared to last year. Mortgage rates are expected to remain low after a delay in a fee on refinances, promoting further buyer activity.

Positive

• Newly pending sales increased by 16.5% year-over-year, indicating strong buyer demand.
• Median U.S. list price rose to $345,255, up 8.3%, marking the highest annual change since July 2019.
• The pace of homes selling has improved, with average time to pending down to 13 days.

Negative

• New for-sale listings decreased by 10.6% year-over-year, indicating supply constraints.
• Total for-sale inventory is down 28.9% compared to last year, exacerbating supply issues.

SEATTLE, Aug. 28, 2020 /PRNewswire/ -- Home seller confidence is growing and the number of new homes on the market is recovering closer to levels seen last year, according to Zillow's Weekly Market Reportⁱ. Still, buyer demand is outpacing this new supply as newly pending sales are up big in year-over-year numbers, driven partly by mortgage rates that fell even further this week. 

Buyer demand is holding strong 

• Newly pending sales were up 16.5% from the same week last year as strong buyer demand is continuing into the late summer. That's the biggest year-over-year jump since mid-February, before the coronavirus pandemic took hold.
• Home sellers that accepted an offer last week typically did so after 13 days, which is 13 days faster than a year ago.

More sellers are entering the market, but demand is still outpacing supply

• New for-sale listings were down 10.6% year over year last week. That's the narrowest gap since late March, a possible sign that sellers are belatedly entering the market as home shopping season extends later in the year than usual.
• Fannie Mae's National Housing Survey shows confidence is growing that now is a good time to sell a home. In July, 45% of respondents shared that belief, up from 41% in June and a recent low of 29% in April.
• Still, due to the pace of pending sales, total for-sale inventory fell further below last year's level. As of last week, there were 28.9% fewer homes on the market than a year ago. 

Last week marked biggest year-over-year list price growth since summer 2019

• The median U.S. list price is $345,255, 8.3% higher than a year ago. That's the biggest annual change since the week ending July 13, 2019. 
• The share of listings with a price cut is holding steady at 4.2%, which is down from 5.7% at this time last year. 
• In the week ending July 11, the median sale price of U.S. homes was $277,500, a 5.1% year-over-year increase. 

Mortgage rates dip lower after FHFA fee delay

• Mortgage rates listed by third-party lenders on Zillowⁱⁱ fell sharply midweek after the Federal Housing Finance Agency announced a delay in its new 0.5% fee on some refinances. The Adverse Market Refinance Fee, which applies to all mortgage refinances serviced by government entities, will be delayed to December 1, rather than September 1.
• Additionally, Federal Reserve Chairman Jerome Powell formally announced a policy shift that will allow for higher inflation in some cases, which is expected to keep interest rates low for a sustained period. The immediate impact on mortgage rates will likely be negligible, and longer-term it's possible this actually moves mortgage rates higher depending on other factors, such as the pace of the economic recovery.

Metropolitan Area*	Newly Pending Sales - YoY	Newly Pending Sales - WoW	Median Days to Pending	New For- Sale Listings - YoY	New For- Sale Listings - WoW	Total For- Sale Listings - YoY	Median Sale Price**	Median Sale Price - YoY**
United States	16.5%	-0.7%	13	-10.6%	0.9%	-28.9%	$277,500	5.1%
New York/Newark, NY/NJ	41.5%	-2.4%	29	9.4%	-0.2%	-16.2%	$447,500	2.7%
Los Angeles, CA	3.8%	-1.1%	13	1.4%	-1.0%	-26.4%	$699,000	4.6%
Chicago, IL	40.1%	-1.7%	13	0.7%	-0.3%	-26.9%	$258,374	3.3%
Dallas-Fort Worth, TX	21.7%	-3.1%	23	-20.9%	-0.9%	-27.7%	$297,250	6.3%
Philadelphia, PA	25.1%	-2.7%	9	-3.5%	-4.7%	-38.6%	$270,625	1.5%
Houston, TX	22.8%	-0.9%	16	-23.9%	-5.4%	-24.4%	$265,625	6.7%
Washington, DC	27.1%	-1.5%	6	-0.5%	2.7%	-34.2%	$434,912	0.9%
Miami-Fort Lauderdale, FL	13.9%	-1.2%	28	-0.9%	3.8%	-12.1%	$326,375	11.5%
Atlanta, GA	13.9%	1.5%	15	-18.4%	8.6%	-22.7%	$274,536	5.6%
Boston, MA	17.3%	-3.3%	7	-12.1%	-3.7%	-23.2%	$514,516	6.8%
San Francisco, CA	39.0%	-1.6%	12	15.3%	4.4%	-0.3%	$871,750	6.5%
Detroit, MI	33.0%	0.3%	8	-1.1%	3.6%	-35.2%	$212,975	6.7%
Riverside, CA	5.5%	-1.1%	10	-3.5%	-0.4%	-46.8%	$400,125	6.3%
Phoenix, AZ	6.7%	0.6%	10	-6.5%	-1.0%	-26.2%	$315,625	9.4%
Seattle, WA	14.2%	0.8%	6	6.5%	-1.9%	-31.5%	$541,067	8.8%
Minneapolis-St. Paul, MN	19.4%	0.2%	16	-0.4%	5.5%	-25.9%	$302,200	7.3%
San Diego, CA	N/A	N/A	8	6.8%	-2.8%	-37.7%	$617,750	2.5%
St. Louis, MO	21.7%	-0.9%	7	-9.3%	4.9%	-31.4%	$211,875	7.5%
Tampa, FL	N/A	N/A	8	-5.8%	5.3%	-31.5%	$253,350	8.1%
Baltimore, MD	11.5%	-1.8%	9	-10.2%	-5.9%	-44.3%	$311,875	1.2%
Denver, CO	19.2%	0.2%	6	-7.5%	-0.5%	-29.5%	$449,712	4.8%
Pittsburgh, PA	23.8%	0.0%	8	-0.3%	0.7%	-25.7%	$194,846	3.2%
Portland, OR	21.3%	1.0%	6	-5.3%	-2.4%	-31.1%	$425,375	5.2%
Charlotte, NC	-7.9%	1.6%	6	-15.9%	4.4%	-40.2%	$283,750	5.0%
Sacramento, CA	17.1%	1.0%	7	-14.1%	2.0%	-40.9%	$457,250	7.6%
San Antonio, TX	48.9%	-1.3%	25	-21.2%	-6.4%	-23.3%	$250,987	6.5%
Orlando, FL	N/A	N/A	11	-2.0%	6.5%	-15.1%	$273,298	3.9%
Cincinnati, OH	6.1%	0.1%	4	-15.7%	-8.3%	-37.6%	$210,074	9.2%
Cleveland, OH	29.5%	0.7%	15	0.1%	11.5%	-37.9%	$174,250	5.9%
Kansas City, MO	10.8%	0.2%	4	-9.7%	-1.3%	-41.3%	$251,875	6.0%
Las Vegas, NV	8.9%	3.4%	14	-4.8%	-3.1%	-24.4%	$312,000	3.7%
Columbus, OH	3.7%	-0.9%	4	-14.7%	10.3%	-38.0%	$228,238	1.6%
Indianapolis, IN	0.8%	-2.1%	5	4.8%	5.0%	-40.0%	$219,095	9.5%
San Jose, CA	-14.2%	2.9%	15	23.6%	0.9%	-20.4%	$1,125,250	0.9%
Austin, TX	29.9%	-0.2%	7	-15.8%	-0.1%	-30.0%	$349,547	5.3%
Virginia Beach, VA	N/A	N/A	25	7.1%	-4.1%	-37.7%	$272,473	4.2%
Nashville, TN	N/A	N/A	36	-14.8%	6.9%	-13.8%	$314,341	4.5%
Providence, RI	0.6%	-2.6%	10	-8.5%	11.3%	-35.0%	$314,600	5.5%
Milwaukee, WI	N/A	N/A	28	-2.7%	2.3%	-10.1%	$245,000	2.7%
Jacksonville, FL	20.4%	-1.9%	13	-13.9%	-10.2%	-31.4%	$265,749	2.3%
Memphis, TN	7.4%	-1.9%	6	-11.1%	6.7%	-39.5%	$208,062	0.5%
Oklahoma City, OK	26.1%	0.4%	10	-22.6%	-9.5%	-32.8%	$201,945	4.0%
Louisville, KY	-5.2%	-3.8%	6	-8.0%	6.1%	-41.5%	$214,128	4.8%
Hartford, CT	22.7%	-1.0%	8	18.3%	26.1%	-43.1%	$250,500	1.9%
Richmond, VA	N/A	N/A	5	-10.9%	0.2%	-36.1%	$274,219	-0.9%
New Orleans, LA	7.1%	-2.4%	13	-16.4%	-3.7%	-40.2%	$227,675	4.6%
Buffalo, NY	19.3%	-1.2%	10	-15.3%	0.0%	-32.5%	$177,375	-0.8%
Raleigh, NC	14.7%	1.2%	5	-24.8%	-10.6%	-34.6%	$306,750	4.0%
Birmingham, AL	33.3%	-0.7%	8	-9.2%	-2.6%	-33.4%	$225,638	7.9%
Salt Lake City, UT	N/A	N/A	6	-37.9%	3.7%	-40.8%	$372,312	7.4%

*Table ordered by market size

**Sale price data as of the week ending July 11

About Zillow

Zillow, the top real estate website in the U.S., is building an on-demand real estate experience. Whether selling, buying, renting or financing, customers can turn to Zillow's businesses to find and get into their next home with speed, certainty and ease.

In addition to for-sale and rental listings, Zillow Offers buys and sells homes directly in dozens of markets across the country, allowing sellers control over their timeline. Zillow Home Loans, our affiliate lender, provides our customers with an easy option to get pre-approved and secure financing for their next home purchase.

Millions of people visit Zillow Group sites every month to start their home search, and now they can rely on Zillow to help them finish it — with the same confidence, ease and empowerment they've come to expect from real estate's most trusted brand.

Zillow is owned and operated by Zillow Group, Inc. (NASDAQ:Z and ZG).

________________________

i The Zillow Weekly Market Reports are a weekly overview of the national and local real estate markets. The reports are compiled by Zillow Economic Research and data is aggregated from public sources and listing data on Zillow.com. New for-sale listings data reflect daily counts using a smoothed, seven-day trailing average. Total for-sale listings, newly pending sales, days to pending and median list price data reflect weekly counts using a smoothed, four-week trailing average. National newly pending sales trends are based upon aggregation of the 38 largest metro areas where historic pending listing data coverage is most statistically reliable, and excludes some metros due to upstream data coverage issues. For more information, visit www.zillow.com/research/.

ii Zillow Group Marketplace, Inc. is a licensed mortgage broker, NMLS #1303160.

 

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SOURCE Zillow

FAQ

What does Zillow's Weekly Market Report say about home buyer demand in August 2020?

Zillow's report indicates that buyer demand remains strong, with newly pending sales up 16.5% year-over-year.

What is the current median list price of homes in the US according to Zillow?

As of the report, the median U.S. list price is $345,255, an increase of 8.3% from the previous year.

How much has new for-sale inventory changed year-over-year according to Zillow?

New for-sale listings have dropped by 10.6% year-over-year, and total inventory is down 28.9%.

What impact did the FHFA fee delay have on mortgage rates?

The delay in the FHFA's Adverse Market Refinance Fee is expected to keep mortgage rates low for now.

How quickly are homes selling according to Zillow's latest report?

Homes that accepted offers last week typically did so in just 13 days, 13 days faster than a year ago.